Category: Vacation Homes

A Vacation Home is a great business

by HOMEiZ Blog Team Posted: 06/08/2016 Views: 1018

Starting a vacation rental business is putting together a business plan. 
Buying a vacation rental property involves real estate, so you can't just pick it and click it as you could, say, a stock. At an absolute minimum, you need supreme patience, an innkeeper's disposition and high tolerance for negative cash flow. Every vacation property is unique and special.

No matter what kind of vacation home you own - single family home, condo, cabin, cottage, chalet, villa, apartment, estate, lodge, townhome, studio, castle, farmhouse, bungalow, or boat - and no matter what its peak rental season is, you need to understand the ins and outs of starting a vacation rental business. The ultimate goal in getting into this business is to profit and maximized your investment.
You have to run your rental like a savvy small business owner would run a successful storefront. Your home and the customer service that accompanies it must provide the things your renters want and need in order for you to reach the highest level of profitability through renting.

Marketing strategy


The best vacation rental owners do more than list their homes on a few listing sites. While they can probably achieve a 75% percent seasonal occupancy rate by doing just that, the best homeowners view their home as a business, not a hobby, and drive a 93% plus annual occupancy. Your occupancy directly affects your ROI, so it's critical to have a robust marketing plan that is evaluated often. A great way to analyze your marketing sources is to divide the cost of each source into the rental revenue obtained. Listing sites also have insights into the number of times your listing is viewed and provide inquiry demographics. Compare these numbers to have a firm understanding which sites are working best, how adjustments made to your ad (and marketing) impact traffic, and who your guest is.
Lastly, team up with local businesses. You are a community and local businesses can also benefit from increased occupancy. Successful vacation rental owners don't hesitate to call nearby restaurants, parks, music venues for discounted (or free) coupons to add to your vacation package. Successful business owners are constantly thinking of ways they can further improve their product/service to better meet their consumers’ unique needs. Think like your consumer to get a better idea of what they will want and need during their stay at your rental. Think of the things you appreciate having during an out of town stay, and make these available to guests of your rental. Also understand your area and provide information and materials that stand to benefit visitors.

Competitive rental rate


An important part of continuously meeting your consumers’ needs is to actually listen to their reviews following a stay. Smart entrepreneurs pay attention to both positive and negative reviews and do their best to understand reviewers’ comments from the consumer’s perspective. If you’d like additional feedback from renters who didn’t leave a review, try sending a quick follow up after their stay to say thank you for choosing your property and ask if there were any additional amenities/resources they would have found useful during their stay. An integral part of managing your rental like a successful small business is staying competitive.

Small business owners are constantly watching market trends and making improvements to keep up in competitive markets. Look at successful listings in your area to see what they’re offering. Additionally, you should keep up on what’s trending in the promotion of successful listings. How can you get your listing out in front of more interested renters?

Running a vacation rental business is way different than simply offering a rental property When you invest in rental properties, you’re offering a commodity. 
When you run a vacation rental, you’re offering a service, It’s a completely different beast from renting a vacant space to a long-term tenant.

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